Should my LLC be taxed as an S-Corp?
Short Answer: Maybe. S-Corps can reduce self-employment tax, but only when profit is high enough to justify payroll and compliance costs.
S-Corp owners pay themselves a reasonable salary through payroll and can take additional profit as distributions. This can create tax savings, but requires proper payroll and filings.
Common mistakes:
• Switching too early
• Not running payroll
• Using an unrealistic salary
What we recommend: Run the math before electing S-Corp. Don’t guess.
Still have questions?
If you’re not sure what applies to your situation, we can help.